Slide 1: Unum: A Review of Performance, Compensation and Governance
Unum: A Review of Performance, Compensation and Governance
Slide 2: Contents
2 Executive Summary Performance Highlights Compensation Governance Voting Recommendations Appendix: Non-GAAP Reconciliation Contents
Slide 3: Executive Summary
3 Executive Summary Unum has a track record of consistently strong performance during a challenging business and economic cycle. Key 2014 financial highlights include: Record operating earnings per share (EPS) of $3.55, our ninth consecutive year of operating EPS growth; Compound Annual Growth Rate
Slide 4: Executive Summary
4 Executive Summary The quality and strength of our balance sheet allows us to remain committed to deploying the excess capital generated through our business. In 2014 we increased the dividend rate by 13.8%. Since 2007 we have paid dividends of $884 million We repurchased $301 million of our outsta
Slide 5: Performance Highlights
Performance Highlights
Slide 6: Consistent Growth in EPS and BVPS
6 CONSISTENT GROWTH IN EPS AND BVPS (ex AOCI) Operating EPS Book Value Per Share Performance Highlights 6.7% CAGR *Does not reflect impact of ASU 2010-26 and special items †Does not reflect the impact of ASU 2014-01 See Non-GAAP Reconciliation in the Appendix 6.8% CAGR
Slide 7: Strong Return on Equity
7 STRONG RETURN ON EQUITY 2014 Operating Return on Equity % AVERAGE CONSOLIDATED GAAP EQUITY AVERAGE CONSOLIDATED GAAP EQUITY* Total 11.4% 1 Performance Highlights Average equity excludes negative allocation of corporate deficit and will therefore not add to 100% Does not reflect the impact of ASU 2
Slide 8: A Track Record of Consistent and Predictable Capital Deployment
8 A TRACK RECORD OF CONSISTENT AND PREDICTABLE CAPITAL DEPLOYMENT Performance Highlights *December 31, 2007 common shares outstanding.
Slide 9: Exceptional Long Term Shareholder Returns
9 Cumulative Total Shareholder Return EXCEPTIONAL LONG TERM SHAREHOLDER RETURNS Ending December 31, 2014 Performance Highlights
Slide 10: Exceptional Long Term Shareholder Returns (Indexed)
10 Indexed Cumulative Total Shareholder Return EXCEPTIONAL LONG TERM SHAREHOLDER RETURNS 10-Year Period Ending December 31, 2014 Performance Highlights 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 130.5% 127.9% 109.4% 79.4%
Slide 11: Compensation
Compensation
Slide 12: Reasonable CEO Compensation
12 REASONABLE CEO COMPENSATION Compensation CEO compensation is both reasonable and appropriate in view of our performance when compared against the prior year and when compared to applicable peer groups Adjusting for the impact of the actuarial Change in Pension Value ($3.2 million) and Company ret
Slide 13: 2014 and 2015 Decisions
13 2014 AND 2015 DECISIONS Compensation The May 2014 say-on-pay vote passed with 97% approval and we have not changed our pay practices since that time We have continued to implement the changes that we began in 2013 which were based on shareholder feedback Beginning with the 2015 grant, we expanded
Slide 14: Governance
Governance
Slide 15: Our Governance Commitment
15 OUR GOVERNANCE COMMITMENT Governance Unum is responsive to shareholders and committed to good corporate governance Separate chairman and CEO roles, including a lead independent director for 2015 Pay for performance Frozen defined benefit plans, including CEO’s SERP Annual say-on-pay votes Robust
Slide 16: Voting Recommendations
Voting Recommendations
Slide 17: Board Recommends Voting FOR All Items
17 The Unum Board of Directors strongly believes that Unum’s compensation programs have been designed and implemented in the best interests of shareholders and aligns pay to Company performance. The Board is committed to good corporate governance and continues to be responsive to shareholders. There
Slide 18: Appendix
Appendix
Slide 19: Slide 19
Slide 20: Reconciliation of Non-GAAP Measures
19 RECONCILIATION OF NON-GAAP MEASURES Appendix 2014 2013 Before-tax Operating Income (Loss) Unum US 856.3 $ 859.0 $ Unum UK 147.8 132.0 Colonial Life 300.2 284.9 Closed Block 122.6 109.4 Corporate (134.4) (143.5) Total 1,292.5 1,241.8 Net Realized Investment Gain 16.1 6.8 Non-operating Retirement-r
Slide 21: Reconciliation of Non-GAAP Measures
20 RECONCILIATION OF NON-GAAP MEASURES Appendix 2014 2013 2012 2011 2010 2009 2008 2007* 2006* 2005* After-tax Operating Income 3.55 $ 3.32 $ 3.15 $ 2.98 $ 2.73 $ 2.64 $ 2.54 $ 2.25 $ 1.85 $ 1.69 $ Net Realized Investment Gain (Loss), Net of Tax 0.05 0.02 0.13 (0.01) 0.05 - (0.89) (0.12) 0.01 (0.02)